Directors Report of Mukesh Babu Financial Services Ltd.

Mar 31, 2018

TO THE MEMBERS,

The Directors have pleasure in presenting the Thirty-Third Annual Report on the business, operations and state of affairs of the Company together with the Standalone and Consolidated Audited Financial Statements for the financial year ended March 31, 2018.

1. FINANCIAL RESULTS

The Company’s standalone financial performance under review along with previous year’s figures is given hereunder:

Particulars	2017-18	2016-17
	Amount Rs	Amount Rs
Income FromCperations	104,164,148	53,289,984
Other Income	2,308,921	2,538,122
Total Income	106,473,069	55,828,106
Refit before Interest, Depreciation & Tax	97,014,728	49,670,492
Less : Interest	9,376,121	11,943,363
Rofit Bsfore Depreciation	87,638,607	37,727,129
Less : Depreciation	787,419	721,011
Rofit After Depreciation and Interest	86,851,188	37,006,118
Less: Current Income Tax	9,500,000	11,100,000
Less: FTevious year Adjustment of Income Tax	184,177	915,919
Less: Deferred Tax	(117,866)	(3,075,423)
Net Rofit After Taxation	77,284,877	28,065,622
Less: Dividend	6,970,900	-
Less: Dividend Distribution Tax	1,419,111	-
Less: Transfer to Statutory Reserve	15,456,975	5,613,124
Less: Rovision for Standard Assets	103,274	(106,251)
Balance carried to Balance Sheet	53,334,617	22,558,749
Earning Fer Share (BaskcOluted)	11.09	4.03

2. TRANSFER TO RESERVE

A sum of Rs.154,56,975/- has been transferred to Special Reserve during the year. Your Company does not propose to transfer any amount to General Reserve out of the amounts available for appropriation and an amount of Rs.5,33,34,617/- is proposed to be retained in the Profit & Loss account.

3. DIVIDEND

The Board of Directors has recommended a dividend of Rs.1.20 (Rupee One and Twenty Paise Only) per equity share on face value of Rs.10/- (Rupees Ten each) i.e.12% for the financial year ended March 31, 2018.

The payment of dividend is subject to approval of Members at the forthcoming Annual General Meeting (AGM), would result a Dividend outflow of Rs.83,65,080/- and dividend Distribution Tax of Rs.17,19,467/- aggregating a total outflow of Rs.100,84,547/-.

Dividend will be paid to those Members whose names appear in the Register of Members as on September 16, 2018.

4. SHARE CAPITAL

The paid-up Equity Share Capital of the Company as on March 31, 2018 is Rs.6,96,75,000/-. During the year under review, the Company has neither issued any shares with differential voting rights nor granted any stock options nor any sweat equity.

The Company’s equity share capital is listed on BSE Limited. The shares are actively traded on BSE and have not been suspended from trading.

5. PERFORMANCE REVIEW / OPERATIONS

During the year under review Income from Operations increased from Rs.532.90 Lakhs to Rs.1041.64 Lakhs (Increase of 95.47%). Profit before Interest, Depreciation and Tax increased from Rs.496.70 Lakhs to Rs.970.15 Lakhs (Increase of 95.32%) and Profit after Tax increased from Rs. 280.66 Lakhs to Rs.772.85 Lakhs (Increase of 175.37%) Provision for taxation for the year is Rs.95.66 Lacs (including Deferred Tax Provision) as compared to Rs.89.40 Lakhs in the previous financial year.

6. PERFORMANCE OF SUBSIDIARY COMPANIES:

During the year under review the Company has only one subsidiary - Mukesh Babu Securities Limited (CIN: U67120MH1994PLC076455) and the Highlights of the financial performance during FY 2017-18 are as follows:

As on March 31, 2018, the Authorised & Paid up Share Capital of the Company is Rs.500,00,000/-(Rupees Five Crores Only) The net loss of the Company for the year ended March 31, 2018 is Rs.10.10 Lacs as compared to net profit of Rs.31.07 Lacs in previous year.

Accounts of Subsidiary:

The Consolidated Financial Statements of the Company are prepared in accordance with the provisions of Section 129(3) of the Companies Act, 2013 and as per the applicable Accounting Standards issued by the Institute of Chartered Accountants of India.

Pursuant to proviso (b) to Section 136(1) of the Companies Act, 2013, a copy of the audited financial statements for the year ended March 31, 2018 alongwith the Reports of the Board of Directors and the Auditors of the Company’s subsidiary- Mukesh Babu Securities Limited shall be furnished to any shareholder on demand.

These are also available for inspection at the Registered Office of the Company and are also being posted on the Company’s website www.mukeshbabu.com

7. CONSOLIDATED FINANCIAL STATEMENTS

As required under Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (“SEBI Listing Regulations”) and applicable provisions of Companies Act, 2013 (“the Act”), the Consolidated Financial Statements of the Company have been prepared in accordance with the applicable Accounting Standards and forms part of the Annual Report. Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of The Companies (Accounts) Rules, 2014, Statement containing salient features of the financial statements of subsidiary is annexed to this report as Annexure -A.

8. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY THAT OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There are no material changes and commitments affecting the financial position of the Company that occurred between the end of the financial year to which this financial statements relate and the date of this report.

9. PUBLIC DEPOSITS

During the year under review, the Company has neither accepted nor renewed any deposits within the meaning of Section 73 and 74 of the Companies Act, 2013 read with The Companies (Acceptance of Deposits) Rules 2014.There are no outstanding deposits at the end of the year.

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The provisions of Section 186 of the Act pertaining to investment and lending activities is not applicable to the Company since the Company is an NBFC duly registered with the Reserve Bank of India. The details of loan given, investments made and guarantees and security provided during the financial year are furnished in the Notes to the financial statements.

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All the related party transactions entered by the Company during the financial year were on an arms’ length basis and were carried out in the ordinary course of business.

During the year under review, the Company had advanced loans to its subsidiary - Mukesh Babu Securities Ltd. There were no materially significant related party transactions made by the Company during the year under consideration with the Promoters, Directors or Key Managerial Personnel which have a potential conflict with the interest of the Company at large.

In accordance with the Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has formulated a Policy on Materiality of Related Party Transactions and a Policy on dealing with Related Party Transactions. The Policy is available on the Company’s Website at www.mukeshbabu.com

The particulars as required under the Companies Act, 2013 are furnished in Form AOC-2 which is annexed as Annexure - B to this report.

12. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 is not applicable to the Company for the financial year under review.

13. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal control system, commensurate with the size of its operations and nature of its business activities. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company.

14. RISK MANAGEMENT

The Company being a Non- Banking Financial Company is regulated by Reserve Bank of India (RBI) and the Board of Directors of the Company has constituted the Risk Management Committee to frame, implement and monitor the Risk Management Policy of the Company. The Committee is responsible for reviewing the risk management plan and ensuring its efficiency. The policy is available on the Company’s website at www.mukeshbabu.com

15. WHISTLE BLOWER POLICY / VIGIL MECHANISM

As required under Regulation 22 of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has an effective Whistle Blower Policy to deal with the instances of fraud and mismanagement. The details of the policy are enumerated in the Corporate Governance Report. The policy is available on the Company’s website at www.mukeshbabu.com.

The policy provides for adequate safeguard against the victimisation of the employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of employees and the Company. The Vigil Mechanism is overseen by the Audit Committee.

16. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee has been set up to redress the complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no cases reported during the financial year ended March 31, 2018. The policy is available on the Company’s website at www.mukeshbabu.com.

17. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

(a) Cessation:

Mr. K. Chandrasekhar who was a Non - Executive Director on the Board of the Company for a period of more than 2 decades expired on 24th October, 2017 and thereby ceased to be a Director on the Board. The Board has been deeply saddened by the demise and places on record deep appreciation for his insightful contribution to the Company.

Mrs. Dipali Shah who was a Whole - Time Director & Company Secretary on the Board of the Company resigned from the Company’s Board with effect from 15th April, 2018 after having served the Company in roles of a Director & Company Secretary.

(b) Appointment of Director:

The Board has appointed Mrs. Meena Mukesh Babu (DIN: 00799732) as Non-Executive Director on the Board of the Company at the Board Meeting held on 29th May, 2018 with immediate effect. A Resolution is included in the Notice convening the Annual General Meeting seeking approval of the members for the appointment of Mrs. Meena Mukesh Babu as Non-Executive Director. The Board recommends her appointment.

(c) Re-appointment of Managing Director:

Mr. Mukesh Babu is re-appointed as the Managing Director with effect from 24th May, 2018 at the Meeting of the Board of the Company held on 29th May, 2018 in accordance with the provisions of Sections 196, 197 and 203 read with Schedule V and other applicable provisions, of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended by Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 subject to the approval of the shareholders at the ensuing Annual General Meeting.

(d) Retirement by rotation:

In terms of the provisions of Section 152(6) of the Companies Act, 2013, Mr. Mukesh Babu, Director (DIN:00224300) retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends his re-appointment.

In accordance with Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and applicable provisions of the Companies Act, 2013, brief profile of the Director to be appointed / re-appointed is included in the Notice which forms part of this Annual Report.

(e) Key Managerial Personnel:

Pursuant to the provisions of Section 203 of the Act read with the rules made there under, the following employees are the whole time key managerial personnel of the Company:

1. Mr. Mukesh Babu - Managing Director

2. Mr. Mahesh Thakar - Chief Financial Officer - appointed w.e.f. 29-05-2018

3. Ms. Dipali Shah - Company Secretary & Compliance Officer -resigned w.e.f. 15-04-2018

4. Ms. Manasi Dalal - Company Secretary & Compliance Officer-appointed w.e.f. 29-05-2018

18. DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have furnished the declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013.

19. BOARD AND COMMITTEES

During the year Four Board meetings were held and the gap between two Board Meetings did not exceed 120 days and atleast one meeting has been held in each Quarter.

The details of the constitution and meetings of the Board and its Committees held during the year are provided in the Corporate Governance Report which forms part of this Annual Report.

20. BOARD’S EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; the Board has framed an Evaluation Policy for evaluating the performance of the Board, Chairman, Managing Director, , Non-executive Directors, Independent Directors and its Committees The Policy inter alia provides the criteria for performance evaluation such as Board effectiveness, quality of discussion, contribution at the meetings, business acumen, strategic thinking, relationship with the stakeholders, corporate governance practices, contribution of the Committees to the Board in discharging its functions, etc.

A meeting of the Independent Directors was held during the year under review.

The manner in which the evaluation was carried out has been explained in the Corporate Governance Report.

21. TRAINING IMPARTED TO THE INDEPENDENT DIRECTORS

As required under Regulation 25(7) of the SEBI Listing Regulations, every Independent Director of the Board is familiarised by the Executive Directors/ Senior Managerial Personnel about the Company’s strategy, operations, organisation structure, human resources, quality, finance and risk management. Further, at the time of appointment of an independent director, the Company issues a formal letter of appointment outlining his/ her role, functions, duties and responsibilities as a director. The terms and conditions of letter of appointment is available on the Company’s website at www.mukeshbabu.com

22. POLICIES OF THE COMPANY

The Company is determined in maintaining a good corporate governance practice and has a robust system for smooth and effective functioning of the Board. Various policies have been framed by the Board of Directors as required under the Companies Act, 2013 and SEBI Listing Regulations in order to follow a uniform system of procedures. These policies are periodically reviewed and updated by the Board of Directors of the Company from time to time. Following are some of the major policies adopted by the Company:

1. Code for Insider Trading Policy

2. Nomination & Remuneration Policy

3. Policy for determination of Material Subsidiary

4. Policy on materiality of Related Party Transactions

5. Policy on dealing with Related Party Transactions

6. Whistle Blower Policy

7. Document Retention and Archival Policy

8. Code for Directors and Senior Managerial Personnel

9. Policy on evaluation of Directors

10. Policy on prevention of Sexual Harassment of Women at Workplace

The aforementioned policies are available on the website of the Company and can be accessed at www.mukeshbabu.com

23. DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(5) of the Companies Act, 2013, your Directors to the best of their ability & knowledge hereby confirms that-

(a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed from time to time and no material departures have been made from the same

(b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the profit and loss of the Company for that period;

(c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) they have prepared the annual accounts on a going concern basis;

(e) they, have laid down internal financial controls to be followed by the Company and that they are adequate and are operating effectively; and

(f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There were no significant and material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

25. STATUTORY AUDITORS

At the 32nd Annual General Meeting of the Company held on 29th September, 2017, the members of the Company approved the appointment of M/s. Chaitanya C. Dalal & Co. Chartered Accountants (FRN.101632W) as the Statutory Auditors of the Company for a term of period of 5 (five) years up to the conclusion of 37th Annual General Meeting subject to ratification of such appointment by the members at every annual general meeting to be held thereafter.

However, pursuant to the Companies (Amendment) Act, 2017 and the Companies (Audit and Auditors) Amendment Rules, 2018, with effect from 7th May, 2018; the requirement of ratification of appointment of the Auditors at every Annual General Meeting has been omitted under the Companies (Amendment) Act, 2017 which is effective from May 7, 2018 and Accordingly the Board proposes to ratify and confirm appointment of M/s. Chaitanya C. Dalal & Co., Chartered Accountants (FRN-101632W) as the Statutory Auditors of the Company up to the conclusion of 37th Annual General Meeting without further ratification of such appointment by the members.

The Company has received written consent and certificate of eligibility pursuant to the provisions of Sections 139, 141 and other applicable provisions, if any of the Companies Act and rules framed thereunder (including any statutory modification or re-enactment thereof for the time being in force) from M/s. Chaitanya C. Dalal & Co., Chartered Accountants.

The approval of the Members is sought, by passing an Ordinary Resolution for ratification of the appointment of the Auditors upto the conclusion of the 37th Annual General Meeting of the Company without the requirement of any further ratification by the members in terms of Section 139 of the Companies Act, 2013 and the Companies (Audit & Auditors) Rules, 2014 made thereunder as amended by the Companies (Amendment) Act, 2017 and the Companies (Audit and Auditors) Amendment Rules, 2018.

26. SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors in its meeting re-appointed CS V. V. Chakradeo of M/s. V. V. Chakradeo & Co., Practicing Company Secretaries (FCS: 3382/ COP: 1705) to carry out the audit of secretarial records of the Company. The consent of the Secretarial Auditor to undertake the secretarial audit for the financial year ended March 31, 2018 has been received by the Company.

The Secretarial Audit Report is annexed to this report as Annexure - C.

27. STATUTORY AND SECRETARIAL AUDITOR OBSERVATION

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso to Section 143(12) of the Companies Act, 2013.

There are no qualifications, reservations or adverse remarks or disclaimers in the Statutory Audit Report and Secretarial Audit Report.

28. EXTRACT OF THE ANNUAL RETURN

Pursuant to the provisions of Section 92(3) of the Act, the extract of the Annual Return is given in the prescribed Form MGT - 9 is annexed to this report as Annexure - D.

29. PARTICULARS OF EMPLOYEES

The disclosures required pursuant to Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is provided as Annexure - E to this report.

During the year under review, the Company does not have any employee who is drawing remuneration of Rs.1,02,00,000/- per annum or Rs.850,000/- per month as stipulated in the Act and the rules made thereunder. Hence, disclosures required under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have not been provided.

30. CORPORATE GOVERNANCE

In compliance with Regulations 17 to 27 and 34 read with Schedule V of SEBI Listing Regulations, as applicable, the Corporate Governance Report is given in Annexure - F and forms part of the Annual Report. The report is duly certified by the Statutory Auditors of the Company.

The certificate duly signed by the Managing Director on the financial Statements of the Company for the year ended March 31, 2018 as submitted to the Board of Directors regarding compliance by the Board members and senior management personnel with Company’s Code of Conduct is also enclosed therewith.

31. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars regarding Conservation of Energy and Technology Absorption are not furnished since the Company is not a manufacturing entity.

During the financial year under review, the Company did not have any foreign exchange earnings and outgo.

32. MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT

The Management Discussion and Analysis is annexed to this Report as Annexure - G and forms the integral part of this report and covers, amongst other matters, the performance of the Company during the financial year under review as well as the future prospects.

33. OTHER DISCLOSURES

a. The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings;

b. The Statutory auditors and the Secretarial auditors of the Company have not reported any instances of fraud or irregularities as specified under Section 143(12) of the Act read with Rule 13 of the Companies (Audit and Auditors) Rules, 2014;

c. There were no significant and material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operation;

d. Maintenance of cost records u/s 148 of the Act is not required for the company;

e. The Company does not have any scheme or provision of money for the purchase of or subscription to its own shares by the employees/ Directors or by trustees for the benefit of the employees/ Directors.

34. GREEN INITIATIVE

As in the previous years, this year too, we are publishing only the statutory disclosures in the print version of the Annual Report. Electronic copies of the Annual Report 2017-18 and Notice of the 33rd Annual General Meeting are sent to all members whose email addresses are registered with the Company / Depository Participant(s). For members who have not registered their email addresses, physical copies are sent in the permitted mode.

35. ACKNOWLEDGEMENTS

The Board of Directors wish to place on record their gratitude for the valuable guidance and continued support extended by the Securities Exchange Board of India, Reserve Bank of India, Stock Exchanges, Insurance Regulatory and Development Authority of India, Ministry of Corporate Affairs, other government authorities, Banks and other stakeholders. Your Directors would also like to take this opportunity to express their appreciation for the dedicated efforts of the employees of the Company.

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

Mukesh Babu Meena Babu

Chairman Director

DIN: 00224300 DIN: 00799732

Date: 10th August 2018

Place: Mumbai

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Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Twenty Ninth Annual Report and the audited statement of accounts for the year ended 31st March, 2014.

31.3.2014 31.03.2013

Total Income 81,617,228 78,772,935

Profit before Interest , Depreciation and Tax 76,766,318 73,279,833

Less: Interest 16,052,787 17,860,049

Gross Profit 60,713,531 55,419,784

Less : Depreciation 838,375 927,519

Profit before Taxation 59,875,156 54,492,265

Less : Taxation Provision & Deferred Tax 16,790,370 14,989,309

Profit available after Taxation 43,084,786 39,502,956

Add: Profit & Loss A/c Credit Balance 178,274,771 154,825,822 Brought Forward

Profit Available for Appropriation 221,359,557 194,328,778

Less: Transfer to Statutory Reserve 8,616,957 7,900,591

Less: Provision for Dividend 6,970,900 6,970,900

Less: Provision for Dividend Tax 1,184,704 1,184,704

Less: Provision for Standard Assets 138,261 (2,188)

Profit & Loss A/c Credit Balance 204,448,735 178,274,771 Carried Forward

MANAGEMENT DISCUSSION AND ANALYSIS Financial Review

Your Company earned a net profit of Rs.430.85 Lacs for the financial year ended 31st March, 2014 as compared to previous year''s net profit of Rs.395.03 lacs. Depreciation during the year was Rs.8.83 Lacs as compared to Rs.9.28 Lacs in the previous year. Provision for taxation during the year is Rs.167.90 Lacs including Deferred Tax Provision as compared to Rs.149.89 Lacs in previous year.

Opportunities

Though during the Financial Year 2013-14, Indian GDP grew by only 5%. However, with a stable government that the Indian Electorate has given at the Centre, the Stock Market and Foreign Institutional Investors have viewed this development positively. The BSE Sensex touched an all time high level of 25,000 on the proclamation of the election results. The stock market has been responding bullishly to pledges by the new government to grow India''s economy by boosting manufacturing and investment, creating new jobs and rolling out much-needed infrastructure, among other promises. With the liquidity that has come into the stock markets equity as a asset class is likely to outperform other asset classes. India still emerges as one of the most sought-after emerging markets for Foreign Institutional Investors. Your company continues to believe in investing in companies, which have good potentials and in specific sectors that will do well in times to come.

Challenges

The Indian Financial Market being closely integrated with the international markets, the challenge is the volatility in the Indian Markets, which is associated with the international events. Earlier this year, investors made a massive exodus from emerging markets on rising geopolitical tensions and worries about the U.S. Federal Reserve raising interest rates. However, with a stable government at the Centre, optimistic view is in sight for the ensuring financial year. Your company is confident of facing all these challenges with its expertise and long-standing experience and is confident of achieving good growth

Risk Management

,Business and revenue growth have to be weighed in the context of the risks. Being an investment Company your Company is exposed to credit, market and operational risks. As part of the risk management process, your Company reviews the various risks and finalises mitigation plans which are reviewed every quarter by Audit Committee of Directors. Proposals of the audit committee are also discussed at the meeting of the Board of Directors every quarter.

Internal Control Systems and their adequacy.

The Company has an adequate system of internal controls and systems. The scope of the inspection and audit has been recently reviewed to make it more effective.

Human Resources

Industrial relations in the organisation continued to be cordial during the year.

No employee of the Company was in receipt of remuneration for whole/part of the year exceeding the limits prescribed under Section 217 (2A) of the Companies Act, 1956.

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary Company, Mukesh Babu Securities Limited, earned a profit before tax of Rs.432.75 Lacs as compared to Rs.118.71 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year 10%) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. Pankaj Majithia, Director, retires by rotation and being eligible offers himself for re-appointment. A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors'' expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors'' Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors'' Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31st March, 2014 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah, Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial Company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs.Nil (Previous Year Rs.Nil)

Foreign exchange outgo during the year Rs.Nil (Previous Year Rs.Nil)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2014 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of Mukesh Babu Financial Services Ltd.

Sd/- Place : Mumbai Mukesh Babu Date: 30/05/2014 Chairman

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Mar 31, 2012

The Directors have pleasure in presenting the Twenty Seventh Annual Report and the audited statement of accounts for the year ended 31 March, 2012.

FINANCIAL RESULTS Year Ended Year Ended 31.03.2012 31.03.2011 Rs. Rs.

Total Income 121,095,368 111.045.820

Profit before Interest, Depreciation and Tax 115,192,194 102,185,452

Less: Interest 26,209,438 27,749,794

Gross Profit 88,982,756 74,435,658

Less: Depreciation 906,244 1,052,468

Profit before Taxation 88,076,512 73,383,190

Less: Taxation Provision & Deferred Tax 25,124,409 21,234,587

Profit available after Taxation 62,952,102 52,148,603

Add: Profit & Loss A/c Credit Balance Brougnt Forward 112,818,927 79,202,419

Add/(Less):lncome tax for Earlier Years 70,000 (620)

Profit Available for Appropriation 175,841,029 131,350,402

Less: Transfer to Statutory Reserve 12,590,420 10,429,721

Less: Provision for Dividend 6,970,900 6,970,900

Less: Provision for Dividend Tax 1,130,854 1,130,854

Less: Provision for Standard Assets 323,034 -

Profit & Loss A/c Credit Balance Carried Forward 154,825,821 112,818,927

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary Company, Mukesh Babu Securities Limited, earned a profit before tax of Rs.72.76 Lacs as compared to Rs. 62.54 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year 10%l) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. K. Chandrasekhar, Director, retires by rotation and being eligible offers himself for re-appointment. A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors' expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors' Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors' Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31** March, 2011 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah. Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial Company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs. NIL (Previous Year Rs. NIL)

Foreign exchange outgo during the year Rs. Nil (Previous Year Rs. 91,025)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2012 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of

Mukesh Babu Financial Services Ltd.

Sd/-

Place: Mumbai Mukesh Babu

Date: 13/08/2012 Chairman

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Mar 31, 2010

The Directors have pleasure in presenting the Twenty Fifth Annual Report and the audited statement of accounts for the year ended 31st March, 2010.

FINANCIAL RESULTS Year Ended Year Ended

31.03.2010 31.03.2009

Rs. Rs.

Total Income 92,903,261 14,806,883

Profit before Interest, Depreciation and Tax 77,890,068 9,429,558

Less: Interest 2,619,714 -

Gross Profit 75,270,354 9,429,558

Less: Depreciation 1,282,721 866,676

Profit before Taxation 73,987,633 8,562,882

Less: Taxation Provision & Deferred Tax 21,958,935 222,673

Profit available after Taxation 52,028,698 8,340,209

Add: Profit & Loss A/c Credit Balance Brougnt Forward 45,599,766 38,942,795

Add/(Less):lncome tax for Earlier Years 131,030 (18,995)

Profit Available for Appropriation 97,759,494 47,264,009

Less: Transfer to Statutory Reserve 10,405,740 1,664,243

Less: Provision for Dividend 6,967,250 -

Less: Provision for Dividend Tax 1,184,084 -

Profit & Loss A/c Credit Balance Carried Forward 79,202,420 45,599,766

MANAGEMENT DISCUSSION AND ANALYSIS

Financial Review

Your Company earned a net profit of Rs. 520.29 Lacs for the financial year ended 31st March, 2010 as compared to previous years net profit of Rs. 83.40 lacs. Depreciation during the year was Rs 12.83 Lacs as compared to Rs.8.67 Lacs in the previous year. Provision for taxation during the year is Rs. 219.59 Lacs including Deferred Tax Provision as compared to Rs. 2.23 Lacs in previous year.

Opportunities

The Indian economy has been robust and the Indian economy emerging as a economic super power is quite evident from the performance of various sectors of the economy. The stock market has been performing well and the index is a clear reflection of the good performance of the economy. Though inflation has been a cause for concern for the economy, the Honble Prime Minister of our country is confident of bringing inflation to controllable levels by December, 2010. Your company continues to believe in investing in companies, which have good potential and in sectors that will be the sunshine sectors in the good times ahead.

Challenges

The integration of our stock market with the Global markets results in increased volatility and unpredictability in our stock and financial markets. However, with Indian Economy doing exceedingly well, the challenge before your company lies in identifying strong companies and sectors where investment can be made for good returns. Your company management is confident of making the right investment decisions on account of the two decades of experience that it has in the field.

Risk Management

Business and revenue growth have to be weighed in the context of the risks. Being an investment company your company is exposed to credit, market and operational risks. As part of the risk management process, your company reviews the various risks and finalises mitigation plans which are reviewed every quarter by Audit Committee of Directors. Proposals of the audit committee are also discussed at the meeting of the Board of Directors every quarter.

Internal Control Systems and their adequacy.

The Company has an adequate system of internal controls and systems. The scope of the inspection and audit has been recently reviewed to make it more effective.

Human Resources

Industrial relations in the organisation continued to be cordial during the year.

No employee of the Company was in receipt of remuneration for whole/part of the year exceeding the limits prescribed under Section 217 (2A) of the Companies Act, 1956.

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary, Mukesh Babu Securities Limited, earned a profit before tax of Rs. 79.43 Lacs as compared to Rs.31.86 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year nil) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. Vijay Vora, Director, retires by rotation and being eligible offers himself for re-appointment.

A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31st March, 2010 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah. Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs. NIL (Previous Year NIL) Foreign exchange outgo during the year Rs. NIL (Previous Year NIL)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2010 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of

Mukesh Babu Financial Services Ltd.

Sd/-

Place : Mumbai Mukesh Babu

Date: 27/08/2010 Chairman